| BenefitsLink Retirement Plans Newsletter |   |
January 30, 2004 - 13,655 subscribers
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Investigators Find Abuses in Annuities
Excerpt: "Opening a new chapter in the investigations of improper fund trading, federal and state regulators have found evidence of trading abuses that hurt investors in variable annuities, a popular product sold by the life insurance industry, several officials working on the investigations said yesterday." (New York Times; one-time registration required)
Federal Regulators Turn Attention to Index Funds
Excerpt: "Federal regulators cracking down on the mutual fund business are now scrutinizing index funds, the core stock market investment of millions of Americans." (Los Angeles Times via Contra Costa Times)
Mutual Fund Trading Abuses and ERISA's Fiduciary Responsibilities
Excerpt: "The fiduciary concerns range from what actions to take with plan mutual funds that are being charged with, or are under investigation for trading abuses and how those abuses may affect the plan's investment policy, to what, if any, action should be taken with those mutual funds where there is no evidence of abusive trading practices. While this is a new and changing area of concern ... there are several initial steps plan fiduciaries should consider." (Haynes and Boone LLP)
Profit Sharing/401(k) Council of America Urges SEC To 'Preserve Level Playing Field'
Press release. Excerpt: "The Profit Sharing / 401k Council of America, in formal comments to the proposed 'hard close' rule designed to address the recent late trading scandals, urged the [SEC] to produce a final rule that does not relegate 401(k) and other employer provided plan participants to second class status. The proposed rule would reduce the ability of ninety percent of mutual fund investors to make fund trades up to the fund's closing time." (Profit Sharing/401(k) Council of America)
Opinion: How About Mutual Fund Trustees We Could Trust?
Excerpt: "Regulators in Washington are soliciting comments on their plan to turn mutual fund trustees into more effective defenders of shareholder interests. Here's one: Start over." (Boston Globe)
Bill Introduced to Allow State Employees to Contribute to 403(b) Programs
Excerpt: "Congressman Virgil H. Goode Jr. (R-Virginia) introduced legislation on January 21, 2004 that would allow state workers to contribute to a 403(b) plan. Bill HR 3718 seeks to 'amend the Internal Revenue Code (IRC) of 1986 to allow state government employers to contribute to section 403(b) pension plans.' These employees currently have access to a 457(b) plan." (403bWise.com)
Summary: House-Passed and Senate-Passed Pension Interest Rate Replacement Legislation (PDF)
2 pages. Excerpt: "The Senate just passed (by a vote of 86-9) legislation (H.R. 3108) temporarily replacing the 30- Year Treasury interest rate with a long-term corporate bond rate for funding and premium purposes in plan years beginning in 2004 and 2005." (The Benefits Group of Davis & Harman LLP via the American Benefits Council)
Ethics Board Hires Lawyer for Case Against Milwaukee Pension Officials
Excerpt: "In November, the Ethics Board authorized complaints against past and current pension officials over accepting entertainment, travel and other perks from pension-fund management firms and other consultants to the fund." (Milwaukee Journal Sentinel)
Pensions in Peril for Some Maine State Employees
Excerpt: "A conflict between state law and federal rules may cause state employees and teachers who retire early and return to work to temporarily lose their retirement benefits. A bill passed by the Legislature in 2001 had allowed those who retired early from state service to return to work and continue to collect their pensions. But that's not allowed under federal rules." (MaineToday.com)
Another Question is Answered in the Davis-Bacon Act Q&A Column
In calculating the maximum deductible contribution for a profit sharing plan that has a 401(k) feature and allows prevailing wage contributions, do you include the compensation of the participants who are eligible for the prevailing wage contributions but not necessarily eligible for the profit sharing contribution? (BenefitsLink.com)
PBGC to Cut Stock Holdings, Possibly Dramatically
Excerpt: "Ten years after it adopted an 'all equities' strategy, the agency that insures pensions has decided it has taken on too much risk and will reduce stocks to as little as 15 percent of its total investments." (New York Times; one-time registration required)
PBGC Announces New Investment Policy (Press Release)
1/29/04. Excerpt: "Under the new investment policy, the PBGC will increase its investment in duration matched fixed-income securities over the next two years. As a result, the portion of invested assets allocated to equities is expected to decline to between 15 percent and 25 percent of total invested assets, from 37 percent as of the end of fiscal year 2003." (Pension Benefit Guaranty Corporation)
Opinion: Cato Report on Social Security Reform Indicates a New Consensus
Excerpt: "With the release today of the Cato Institute's plan for a personal account option for Social Security, a new consensus has now been established among those advocating such reform. The Cato plan calls for allowing workers to shift into the account 6.2 percentage points of the 12.4 percent Social Security payroll tax." (Peter Ferrara in the Washington Times)
Links to Items on Executive Comp, Benefits in General
Federal Reports Show Continued Benefits Cost Increases
Excerpt: "Employee benefit cost jumps once again outpaced salary increases during the last quarter of 2003, reports the Labor Department, noting benefits represent the half of total compensation costs." (BenefitNews.com)
Newly Posted Events
The Potential Implications of HSAs on Plan Design, Delivery, and Funding
Nationwide on January 28, 2004
presented by Hewitt Associates LLC
Newly Posted or Renewed Job Openings
Employee Benefits Sales Representative
for Great-West Healthcare
in CA, CT, NY, WA
Consulting Actuary
for New York Life Investment Management LLC
in MA
Pension Administrator
for The National Advisory Group, Inc./Pension Consulting Services, Inc.
in PA
Defined Contribution Plan Administrator
for Privately Held Benefit Consulting & Actuarial Firm
in IL
Director of Compensation and Benefits
for We have been hired as the recruiter of choice for an Atlanta firm
in GA
Actuarial Student
for Harbridge Consulting Group
in NY
Retirement Trust Relationship Manager
for Reliance Trust Company
in GA
Marketing Consultant
for Principal Financial Group
in CA
Marketing Specialist
for Principal Financial Group
in IN
Regional Wholesaler
for Principal Financial Group
in CA
Sales Representative-Retirement
for Principal Financial Group
in NY
Consulting Pension Actuary
for InDemand Staffing of St. Louis, Inc.
in CA, MN
Plan Service Team Analyst
for ICMA Retirement Corporation
in DC
Handy Links:
- View Today's Active Message Threads
- Search BenefitsLink
- Using the Web for Employee Benefits Research
- Employee Benefits Library
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